The guy is super pissed.If you were an alien from Mars and sat in on one of these meetings, you would believe that a client’s success or progress was not part of the thought process at all.

The guy is super pissed.If you were an alien from Mars and sat in on one of these meetings, you would believe that a client’s success or progress was not part of the thought process at all.
So it is becoming clear that after this debt restructuring and the gut wrenching austerity, the economy of Greece has to respond and start growing. Otherwise we will be back to where we were. Further is there stomach in Euro-zone countries for further bailout of Greece? This question has to be asked as it is becoming increasing clear that IMF might not come or be in a position to ride to the rescue of Greece.“In the event of slower progress in policy implementation, or failure of the economy to respond rapidly enough to reforms, completion of reviews may require additional support from Greece’s European partners on yet more concessional terms than currently envisaged, and-or another restructuring of bonded debt,” according to the report.
[IMF] has reduced its share in the second Greek bailout as it sees its exposure to the euro region posing what the staff called “unprecedented financial risks” to its finances. It has also pushed European governments to boost their own bailout fund in an effort to protect Spain and Italy from contagion.
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“If the program goes off track, Greece’s capacity to meet its obligations to the fund would hinge critically on the willingness of European partners to continue to backstop Greece’s payments capacity and the Eurosystem’s capacity to backstop bank liquidity while further efforts are put in place to stabilize the Greek economy,” IMF staff warned.
And for those interested in reading the full IMF report, it can be found over here.The Greek government must continue to meet the conditions set by its international creditors to receive aid payments at three-monthly intervals.
The IMF report said the new program was “subject to exceptional risks,” including upcoming elections that create uncertainty over whether the measures will implemented.
“The materialization of these risks would most likely require additional debt relief by the official sector and, short of that, lead to a sovereign default,” it wrote. “In the absence of continued official support and access to” refinancing by the European Central Bank, “a disorderly euro exit would be unavoidable.”
How to make rich richer and poor poorer -first world style?The accompanying narrative on the Ferozepur, Punjab born attorney talks of the “man who is bringing mob squad justice to Wall Street”
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Bharara announced mortgage fraud charges in New York on three former highlevel employees of Credit Suisse accusing them of overstating the value of bundled housing loans by $540 million and contributing to an eventual $2.65 billion write-down by the bank.
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when he came to the job in 2009, he found that “there was a creeping culture of corruption in our politics and also in Wall Street and in business generally”, a complaint echoed by the US president.
Insider trading, he says, was a practice which “tells everybody at precisely the wrong time that everything is rigged and only people who have a billion dollars and have access to and are best friends with people who are on boards of directors of major companies, they’re the only ones who can make a true buck” .
As always, once again you are just propagating false rumors and CTs. Do you even bother to counter-check what you are reading from shady blogs, before running to post in BR?Neshant wrote:With absolutely zero coverage by the "mainsteam" corporate media, President Obama Friday night signed the national defence resources preparedness executive order, outlining the federal governments plans for 100% control of private resources, labor, and assets in the event of an emergency.
This coming on the heels of NDAA (National Defence Authorization Act) which can have people arrested as terorrists/trouble maker without proof, put in jail and even killed.
Surely something is coming down the pike which is why these draconian laws are being put in place to control people who find out they've been ripped off.
I wonder if the above could be used to seize people's savings, pensions even wages in a time of economic turmoil. Certainly if you can be jailed without habeus corpus, its no big deal for banking crooks in collaboration with govt to steal of the fruits of a person's labor.
Its looking more & more murky by the day. Get at least some of your money out of the country and into something tangible that is beyond the reach of government taxation, confiscation..etc.
Not only the reaction to this [Executive Order] wildly over the top in some corners, but the Executive Order itself is nothing more than a restatement of policy that has been in place in decades and grants no authority to the President or the Cabinet that they don’t already have under existing law. The Defense Production Act has been in effect since the Truman Administration, and authorizes the President to direct private business to allocate resources to national defense as needed in a time of national emergency.
A growing ‘oil bubble’ is becoming more serious a threat to the global economy than European weakness, according to head of the IMF. And these are market speculators who are enlarging the bubble, even though there is no threat of an oil shortage.
“It’s obvious that Europe is no longer in the focus of everybody’s attention,” Christine Lagarde says.
Today the prices for oil are spinning upwards, with Brent Crude now being traded at $124.5/bbl and WTI standing at about $106.6/bbl.
Geopolitical factors have become a major player in the oil market, Sergey Vakhromeev, a senior analyst at Metropol, told Business RT. The fears over disruptions of oil deliveries from Iran, as well as political unrest in the Middle East, make investors bid higher.
Today “around $20 to $25 in the current oil price is a “fear premium,” Vakhromeev specified.
Meantime, there’s enough oil for everybody in the world, as Saudi Arabia, for example, could easily compensate for the possible loss of Iranian oil, the Metropol expert said.
Also experts don't expect Iran to close the Strait of Hormuz anytime soon. "Iran is still tightened to the world of trade despite US measures there are still countries that buy its crude. Right now I don’t think they will attempt to close the Strait", Jorge Montepeque is Platts' Global Director of Markets Reporting told RT.
He stressed: "Of course closing it isn’t an easy thing to do. We have been there 20 years ago during Iran-Iraqi war and the Strait was never fully shut down."
Last week the country tried to “scare prices lower” – to a more sustainable level of $100/bbl for Brent -, saying it was ready to ramp up production. Saudi Arabia wanted to stress that “the market is actually currently oversupplied and that inventories are rising,” said Chris Weafer, a chief strategist at Troika Dialog.
“The country fears the price is being pushed higher by speculators playing the expanding risk premium, and that the higher the price rose the greater the risk of a 2008-style collapse,” Weafer specified.
In July 2008, the price of oil hit a record high of over $147 a barrel and then nosedived.
Trump Warns ‘Massive Inflation’ Coming, Prepare
Monday, 05 Mar 2012 12:39 PM
By Newsmax Wires
http://www.moneynews.com/StreetTalk/Tru ... ODE=E67B-1
Billionaire Donald Trump says the U.S. economy is poised for “massive inflation” and is warning investors to take steps now to protect themselves.
In the gripping CNBC interview, Trump also told investors they should not trust official government statistics.
He even questioned the “official unemployment” numbers. “It’s over 20 percent. It’s not 8.3 percent,” Trump said.
Trump also thinks skyrocketing oil prices will cripple the U.S. economy. “Right now, [oil] is at an all-time record for this time of the year, in the summer they predict $5 gasoline, maybe $6.”
But Trump isn’t the only expert warning the U.S. economy may go off the cliff. Robert Wiedemer, author of the New York Times best-selling book Aftershock, stated in a recent interview, “The data is clear, 50% unemployment, a 90% stock market drop, and 100% annual inflation . . . starting in 2012.”
Editor’s Note: See the disturbing interview with Wiedemer.
When the host questioned such wild claims, Wiedemer unapologetically displayed shocking charts backing up his allegations, and then ended his argument with, “You see, the medicine will become the poison.”
This gripping, no-nonsense interview is quickly becoming a financial beacon in an economic tsunami with over 30 million people from around the world listening in.
But it’s not just the grim predictions that are causing the sensation; rather, it’s the comprehensive blueprint for economic survival that’s really commanding global attention.
In 2006, he and his team of economists accurately predicted the four-bubble meltdown in the housing, stock, private debt, and consumer-spending markets that almost sank America.
Regardless of his warnings and survival advice, Bernanke and Greenspan were not about to support Wiedemer publicly, nor were the mainstream media.
Read more: Massive Inflation Coming, Warns Donald Trump
Yup! and dealt with it by declaring his 4th Bankruptcy.What an empty headed blow hard.In 2006, he and his team of economists accurately predicted the four-bubble meltdown in the housing, stock, private debt, and consumer-spending markets that almost sank America.
That schedule is punishing. The government is on the hook for €3.1 billion every year until 2023, with smaller annual outlays due until 2031. This year’s sum, due on March 31st, represents around 2% of GDP. From next year interest payments on the debt are due to be counted against the budget balance. To meet its deficit targets the government will have to make further cuts. Hence rising pressure in Dublin for a deal to restructure the payments.
Now those price increases are starting to filter down to the retail level. During a recent meeting with USA TODAY's editorial board, Wal-Mart CEO Bill Simon said that rising inflation in the United States is "going to be serious" and that Wal-Mart is "seeing cost increases starting to come through at a pretty rapid rate." For many years Wal-Mart has been famous for their "low prices", so for the head of Wal-Mart to publicly warn that much higher prices are coming is more than a little alarming. There are millions of American families that are already drowning in debt, that can barely pay their mortgages and that are struggling to put food on the table for their families. So what is going to happen to the U.S. economy when prices start rising substantially at places such as Wal-Mart?
But Wal-Mart is not the only major corporation that says that inflation is coming. Hershey has just announced price increases of about 10 percent on their entire line of products.
So if you like chocolate you better start stocking up now.
Cocoa production is being seriously threatened by the political unrest in Africa right now. The recent chaos in the Ivory Coast is certainly not good news for Hershey, but the truth is that all of the long-term trends indicate that prices for commodities such as cocoa, coffee and sugar are going to move up anyway.
In fact, Aaron Smith, the managing director of Superfund Financial, believes that coffee, sugar and cocoa will all be five to ten times more expensive by 2014 than they are today.
So if you are addicted to coffee or to sugar you might want to start making your plans accordingly.
But the truth is that inflation is not limited to just a few commodities. Virtually every major agricultural commodity has soared in price over the past 6 months to a year.
So what is causing all of this?
Well, there are several factors which are major contributors.
First of all, overall global demand continues to increase. The population of the world continues to grow, and as the economies of nations such as China and India develop, millions more people want to enjoy luxury items such as chocolate and coffee just like Americans do.
Secondly, all over the world central banks have been recklessly printing money in an attempt to stimulate their economies, but this is also going to end up causing tremendous inflation.
So how does that work?
Well, it is actually very simple.
For example, in the United States when there are more dollars chasing the same number of goods and services, what is going to happen?
Prices are going to rise of course.
And we are seeing this happen all over the world right now.
Thirdly, as the price of oil continues to rise, it is going to increase the cost of everything else. The era of massive amounts of cheap food being transported around the world using massive quantities of cheap oil is rapidly coming to an end.
The following chart if from the Federal Reserve. It shows that the price of oil is rapidly moving back to the level it was at prior to the financial crisis of 2008. In fact, this chart is slightly out of date. At last check, the price of oil was over $107 a barrel. So what is it going to mean for our economy if we soon surpass the record that was set back in 2008?....
Fourthly, global instability is also going to cause prices to continue to rise. Over the past year we have had really bizarre weather all over the globe, we have seen revolutions erupt all over Africa and the Middle East and the third largest economy in the world (Japan) just experienced the worst disaster that they have been through since World War 2 ended.
When things are unstable, economies don't work as efficiently. That means that less goods and services are produced.
But when there are less goods and services being chased by an increasing amount of money that tends to push prices up.
The truth is that inflation is here, and if the CEO of Wal-Mart is right, it is not going to go away any time soon.
In fact, many believe that the world is on the verge of another major economic crisis.
If you stop and think about it, every major region of the world is dealing with very serious problems right now.
Right now, the European debt crisis is worse than it ever has been before. Did you notice that Standard & Poor's just downgraded Portugal's debt for the second time in a week? Now Portuguese debt is rated BBB-, which is only one level above junk status.
That is a very alarming sign.
Asia is dealing with the Japanese crisis, nearly all of the countries in the Middle East are dealing with protests or full-blown revolutions, Africa is dealing with the war in Libya and quite a few revolutions of their own, and the U.S. is still deeply struggling with a whole host of economic problems.
Most Americans don't realize just how precarious things are at the moment for the global economy. The financial crash of 2008 did a lot of lasting damage, and the next wave of the financial crisis could potentially be even worse. Unfortunately, the global financial system is more vulnerable than ever right now.
So what are the Federal Reserve and other central banks going to do the next time a major financial crisis happens?
They are going to print even larger quantities of money and they are going to give even larger bailouts to their friends of course.
The dollars that you have today are never going to be more valuable than they are right now. Don't wait too long to use them. If you have a huge pile of dollars sitting in the bank your wealth is slowly but surely rotting away.
Very hard economic times are coming. The inflation that the CEO of Wal-Mart is warning about is only the beginning. Eventually we are going to see inflation in this country that is going to be absolutely mind blowing.
But don't wait until the storm hits to start preparing. We all have time now to prepare, so let us be wise and make the most of it.
The guy was holding huge seminars in 2006 advising people to invest in residential real estate as a safe bet at the height of the propety bubble.Trump Warns ‘Massive Inflation’ Coming, Prepare
I agree. He is trying to boost the value of his under water real estate. He is a republican nut case. Remember the president obama birther issue he raised.Neshant wrote:The guy was holding huge seminars in 2006 advising people to invest in residential real estate as a safe bet at the height of the propety bubble.Trump Warns ‘Massive Inflation’ Coming, Prepare
Perhaps the guy is trying to sell his over-priced real estate investments as its starting to collect dust.
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Debt collectors are the subject of more complaints to the Federal Trade Commission than any other industry -- almost 181,000 last year. Within the past 17 months, three companies working for the Education Department -- including one that is majority owned by JPMorgan Chase & Co. (JPM)'s private-equity arm -- settled federal or state allegations of abusive debt collections. The companies didn't acknowledge wrongdoing, and Chase declined to comment. The Education Department said the government investigations didn't involve the companies' work for the agency.
The U.S. Consumer Financial Protection Bureau, created in 2010 in the wake of the credit crisis, has proposed supervising the largest debt collectors to ensure they are complying with laws such as the Fair Debt Collection Practices Act. About 5 million federal education-loan borrowers are in default, generally meaning they have failed to make payments for 270 days or more.
"With student-loan defaults rising, we want to make sure borrowers clearly understand their loan-repayment options and debt collectors are following the law," Rohit Chopra, the agency's student-loan ombudsman, said in an e-mail.
'Reasonable and Affordable'
Federal-aid law requires collectors to offer "reasonable and affordable" payments, so debtors can "rehabilitate" their loans, repairing their credit and making good on what they owe taxpayers.
The law mandates no minimum payment for a borrower to enter a rehabilitation program, and collection companies may take borrowers' finances into account. The fair debt act forbids collectors from making "any false, deceptive or misleading representation."
Insisting that cash-strapped borrowers make minimum payments and then failing to disclose lower-cost options violates both federal-aid and fair debt-collection laws, according to Deanne Loonin, an attorney with the Boston-based National Consumer Law Center.
Debt collectors said they follow federal laws and use all available tools to recover money for taxpayers. The companies are helping to make sure that future college students have access to financial aid, said Mark Schiffman, spokesman for ACA International, a Minneapolis-based industry trade association.
$1 Billion Commissions
Debt-collection companies helped the Education Department recover $11.3 billion in defaulted loans during the year ended Sept. 30. The agency projects it will collect 85 cents on every dollar that defaults, factoring in collection costs and the time-value of money.
The debt collectors made out well, too. Based on a review of government contracts and Education Department data, the private companies -- working directly for the government and through state agencies -- received commissions of about $1 billion in the year through September.
Sallie Mae and the Education Department declined to answer questions about Campos's comments. The company cited privacy rules and the terms of its government contracts. Newark, Delaware-based Sallie Mae said it works with borrowers in financial difficulty and offers lower payments when appropriate.
"We have helped thousands of student-loan customers in default get back on track to fulfill their obligations, giving consumers the opportunity to improve their credit and providing cost savings for the American taxpayer," Patricia Nash Christel, a Sallie Mae spokeswoman, said in an e-mail.
New Rules?
The Education Department this week will hold meetings with industry, government and consumer representatives to consider requiring that debt collectors automatically offer payments based on income to defaulted borrowers who qualify. If approved, the rules could take effect in July 2013.
"We want to make sure we are striking the right balance between helping borrowers who have hit hard times and honoring our responsibility to be good stewards of taxpayer dollars," Justin Hamilton, an Education Department spokesman, said in a phone interview.
To protect customers, the department randomly monitors tape recordings of student-loan debt-collection calls, Hamilton said. The department is also considering changing the commission structure in its debt-collection contracts, he said.
The agency encourages students to file reports if they feel mistreated, Hamilton said.In the year ended in September, the department received 1,406 complaints against the debt collectors it hires, up 41 percent from the year before.
Collectors' Power
Under U.S. law, student loans can rarely be discharged, even in bankruptcy, making them more difficult to shake than credit cards or past-due mortgages. The government can also confiscate tax refunds and Social Security payments, as well as paychecks.
"Student-loan debt collectors have power that would make a mobster envious," Harvard Law Professor Elizabeth Warren, who helped establish the Consumer Financial Protection Bureau and is now running for a U.S. Senate seat from Massachusetts, said in 2005.
Under Education Department contracts, collection companies "rehabilitate" a defaulted loan by getting a borrower to make nine payments in 10 months. If they succeed, they reap a jackpot: a commission equal to as much as 16 percent of the entire loan amount, or $3,200 on a $20,000 loan.
Incentive Pressure
These companies receive that fee only if borrowers make a minimum payment of 0.75 percent to 1.25 percent of the loan each month, depending on its size. For example, a $20,000 loan would require payments of about $200 a month. If the payment falls below that figure, the collector receives an administrative fee of $150.
That differential provides an incentive for collectors to insist on the minimum payment and fail to reveal when borrowers are eligible for a more affordable schedule, according to Loonin, the attorney at the National Consumer Law Center, which is representing borrowers in the Washington talks with the Education Department
Customers benefit from successfully rehabilitating a loan, because they repair their credit, and the government removes thousands of dollars in fees and collection costs, the Education Department and Sallie Mae said. Taxpayers, rather than borrowers, pay the rehabilitation commission, according to the agency. Students who immediately sign up for income-based plans, through a program called consolidation, don't get those benefits, Sallie Mae and the Education Department said.
Automatic Dialers
Debt collectors are under pressure to extract as much money as they can up front, or lose their jobs, said J.C. Cournan, who worked for Pioneer Credit Recovery from 2004 through 2007.
Collectors, then paid about minimum wage, could earn thousands of dollars a month in bonuses, based on the money that borrowers repaid, said Cournan, who took the upstate New York job out of high school. Pioneer set monthly goals for wage garnishments and loan rehabilitations, he said.
Using automatic dialers to track down borrowers, Cournan would figure out where they worked, then contact their employers. He would tell borrowers that he was going to seize part of their wages if they didn't make the payments. Using a company loan calculator, Cournan would insist on the minimum payment, he said.
"When wou're making 8 bucks an hour, it's all about the bonuses. You're starving," said Cournan, 26, now an auto mechanic.
Gift Cards, TVs
Pioneer maintained a "boiler room" environment, with high turnover among those who didn't perform, said Joshua Kehoe, a former collector. Kehoe worked in Batavia, New York, from July 2006 through October 2008 after managing a pizza stand at a theme park.
Pioneer rewarded collectors with $100 restaurant gift cards, a $500 mahogany jewelry box, televisions and a trip to the Dominican Republic, according to Kehoe, who said he earned $9.60 an hour before the incentives.
It would be "a cold day in Hades" before collectors would tell borrowers about options with lower payments, according to Kehoe, who said "rehab cash was king." The company pushed collectors to sign borrowers up for the rehabilitation plans, which often required payments equal to 1.25 percent of their loan amount monthly, he said.
Heavy Heart
"It was hard on my mind -- it was hard on my heart," said Kehoe, 25, who now works as a welder in Akron, New York. "There was the guy with one leg or the single mom with five children."
Under pressure to meet collection goals, Kehoe falsified documents for verifying the employment of borrowers who were subject to wage garnishment, he said. Pioneer discovered the violation and dismissed him, Kehoe said.
Sallie Mae declined to discuss the former employees' comments. The company uses a mix of hourly pay "substantially above minimum wage" and performance-based incentives, said Sallie Mae's Christel.
Like other debt collectors, "we design a compensation system that pays for good performance," Christel said. "We take compliance seriously and design our policies and practices to meet all applicable fair debt collections laws and federal government service contract requirements."
The Internal Revenue Service in 2009 stopped using private debt collectors, saying its own employees were more cost effective and flexible for taxpayers facing economic hardship.
'IRS Was Better'
The IRS let Campos, the Boston student-loan debtor, set up a payment plan he could afford when he fell behind on his taxes, he said.
"The IRS was better," Campos said. "They bent over backwards to help you."
The Education Department will "definitely want to take a look" at IRS collections to see "what their experience has been," Hamilton, the Education Department spokesman, said.
Twenty-three collection companies work directly for the Education Department. Most of the same outfits have contracts with state guarantee agencies that also chase student-loan borrowers on the government's behalf.
In the past 17 months, three companies have run afoul of federal and state investigators, though the Education Department said their inquiries didn't involve their government student- loan business.
Wrong Numbers
During this period, Minneapolis-based Allied Interstate Inc. and Atlanta-based West Asset Management Inc. paid $1.75 million and $2.8 million, respectively, to settle lawsuits alleging abusive debt collection filed by the Federal Trade Commission. The companies admitted no wrongdoing. In February, to resolve an investigation by 19 state attorneys general, NCO Group, majority-owned by JPMorgan Chase, agreed to pay $575,000 and provide up to $50,000 per state for consumers who can show wrongful collections. The companies admitted no wrongdoing.
Allied has taken steps to correct mistakes -- primarily repeated phone calls to wrong numbers -- and complaints have fallen, Robert Burke, vice president for marketing of iQor Inc., the company's parent, said in an e-mail.
West disagreed with the FTC's findings, Deputy General Counsel Greg Hogenmiller said in an e-mail. Consumers haven't made claims to NCO since the attorneys general settlement, and no wrongdoing was found, Ronald Rittenmeyer, chief executive officer of Horsham, Pennsylvania-based NCO, said in an e-mail.
Defaults Surge
The collection business is booming as defaults more than doubled since 2003, along with outstanding federal student loans, which totaled $848 billion as of Sept. 30, surpassing credit-card debt.
The U.S. loan program was born in 1965 as a "Great Society" initiative for lower-income students under President Lyndon Johnson. Today, with tuition soaring, two-thirds of college seniors graduate with loans, which average $25,000, according to the Institute for College Access & Success, an Oakland, California, nonprofit education and advocacy group.
Obama -- supported by Congress -- has pledged to give borrowers a break and make college more affordable.
In 2009, Congress expanded a program that lets lower-income students tie payments to their incomes. It's a sliding scale, based on their debt, salaries and family obligations. Married borrowers with two children, $30,000 in income and $30,000 in student loans wouldn't have to make any payments, according to a government loan calculator. If circumstances don't improve, the loans can be canceled after 25 years.
In October, Obama proposed making payments even lower and forgiving loans after two decades for some borrowers, as soon as this year.
Disabled Mom
Kimberly Noland could have used that kind of help.
Noland, 44, lives in Fayetteville, Arkansas, with her husband, a laid-off factory worker now employed at a Wal-Mart store, and their seven-year-old daughter.
Noland injured her leg while working in a day-care center. She started collecting $828 a month in Social Security disability payments in 2010.
Shortly after she qualified, Collection Technology Inc., an Education Department debt collector, called about Noland's roughly $30,000 in defaulted student loans from attending the University of Arkansas.
A collector told her she had to pay $325 a month, almost as much as her rent, Noland said in a phone interview. She couldn't afford it on her family's $20,000 annual income, she said.
"I have a child," Noland remembered telling the collector. "I can't give you every bit of money in my house."
'Final Number'
"This is our final number," the collector replied, saying her boss wanted even more, according to Noland. The phone conversation lasted more than an hour, she said. She was given three days to decide, or Collection Technology would seize part of her disability check "forever," and she would never have another chance to rehabilitate her loan, Noland said.
She bought a prepaid debit card at Wal-Mart, authorizing Collection Technology to make the $325 monthly withdrawals. She visited churches to collect free bread and canned goods.
"I didn't know why it had to be such a high dollar amount," Noland said. "They have the power, I guess. You do what you have to do to make them happy."
Chris Van Dellen, CEO of Collection Technology in Monterey Park, California, referred questions about Noland's comments to the Education Department, which declined to discuss her case.
In October, Noland and her husband filed for bankruptcy. Last year, she qualified for the Education Department's income- based plan. Her monthly student-loan payment: zero.
To contact the reporter on this story: John Hechinger in Boston at [email protected]
To contact the editor responsible for this story: Lisa Wolfson at [email protected];
That is precisely the problem with Gold standard. It limits the amount of currency and trade that can happen.Neshant wrote:Speech: Bernanke Fails at Transparency, Rails at Gold Standard
Written by Bob Adelmann
Wednesday, 21 March 2012 17:21
For example, his attack on the gold standard was filled with falsehoods and half-truths that failed to convince, only to confuse:
The gold standard as an alternative to a central bank: The gold standard sets the money supply and [the] price level generally with limited central bank intervention.
He fails to make clear that it’s the quantity of gold that “sets the money supply” and from that is derived the value of each piece, which is reflected in its purchasing power in the marketplace.
Central Bank does not place any limitation on the money that citizens use or can use. They simply say that the legal tender for their transactions is going to be X or Y. In many countries with central banks people do exercise their choice and carry out transactions in currency other than one which is issued by central bank. So in no way does central bank compel anyone, least of all citizens, to use X or Y. Free will or Choice is still in the hands of people.Buried in the comment “with limited central bank intervention” is the core of the problem: Bernanke doesn’t want people making those choices and decisions for themselves. Those decisions must be left to experts like himself to tell the citizens what is allowed to be used as money and what is not. It’s that beautiful limitation that the gold standard places on banks that Bernanke doesn’t like.
Absolutely true. What the gold standard does is limit the amount of money supply to the amount of gold that can be dug out from the ground and placed again underground in some vault. And this is not the problem alone with gold standard. This is a problem with all the metal-based currency system, like silver. Hell in the past opium was used predominantly in East Asia as a substitute.Another example:
Problems with the gold standard: The strength of the gold standard is its greatest weakness too: Because the money supply is determined by the supply of gold, it cannot be adjusted in response to changing economic conditions.
When the so called country[let us for example say US] was enjoying its so called "greatest and grandest economic explosion", it was also going through the gut wrenching recessions and depression. One of the chief causes of great depression was the thrall that people had of the gold standard. France and US accumulated so much gold and refused to let it circulate that Germany went kaput and Britain was forced to go off the gold standard. In fact had the gold standard had been abandoned much earlier it would have been possible to avoid the rise of the nut-case, hare-brained, single-testicle Hitler. And probably we would have avoided the carnage that followed.Here in full flower is the consummate arrogance of a central banker: “Because the money supply is determined by the supply of gold” and not by experts gathered around a mahogany table in a building in downtown Manhattan, it is therefore a bad thing. He admits that the supply of money “cannot be adjusted in response to changing economic conditions,” which is of course another expression of the necessity of a banker to do the adjusting. Of course, the free market adjusts the supply of everything when it is left alone to do so, even the monetary unit itself. That’s why, when the country was enjoying its greatest and grandest economic explosion in the late 19th century the country was on (or, to be fair, close to) the gold standard, the price level declined, reflecting that explosion and resulting in a rapidly rising standard of living because each piece of money bought more.
False. What gold standard did was keep inflation in check. It did not assure that a person would be able to purchase more goods and services in the future. And the funny part is gold standard did not eliminate inflation.Put another way, savers were rewarded knowing that their savings would purchase more goods and services in the future.
True, but this has nothing to do with Gold Standard. The current situation, where trading for the heck of trading without any real correlation to the real economy has to do with the economic shifts that are ongoing.Banks were simply another piece of the economy, providing banking and loan services for a fee and protection for savers with their vaults.
So gold standard does nothing to avoid the so-called booms and busts. Thanks a lot for accepting this. So what is the utility of this gold standard, when booms and busts cannot be eliminated? And dont forget the biggest and worst boom and bust happened under gold standard, the Great depression. This is provided we ignore the depression of 1890s or worse the depression of 1870s.Problems with the gold standard:
Although the gold standard promoted price stability over the very long run, over the medium run it sometimes caused periods of inflation and deflation.
Really, the professor should know better. Booms and busts under the gold standard were largely and predictably the result of banks and bankers lending beyond their deposits through fractional-reserve mechanisms. When depositors wanted their gold back, the banks were unable to honor those requests. The money supply shrank, the banks went bust, and the depositors learned valuable lessons.
So if I had a 10-gram gold in 1800, I would be able to buy the same amount of goods say in 1880s that I was able to buy in 1800? Is this author nuts or smoking something potent?Over the long run, since the beginning of the republic until approximately 1910, the price level remained constant. Put another way, a piece of gold money retained its purchasing power for nearly 150 years without a central bank. But once central banks got involved, the stability vanished. And when the last vestige of the gold exchange system disappeared in 1971, the inflation inherent in a paper standard exploded. One dollar today is worth only 18 cents in 1971 money. A dime is worth two cents. A nickel is worth a penny. A penny — is essentially worthless. All thanks to the Fed.
The good professor told the truth. But the author could not comprehend the truth. The author lives under the fallacy that what was good in 1800s is good enough 100 years later in 2000s. There is a concept called as "disconfirmation bias". What this implies is that to disprove a belief, the standard of evidence required is higher than what is required to prove the belief. It seems to me, IMHO, the author suffers from this.Why didn’t the good professor, in the interest of transparency, tell the truth, the whole truth?
Absolutely true. It was meant to prevent bank runs and preventing cascading collapses of banking financial entities. It has stayed true to its mandate, even in case of horrific consequences. But Fed was not created in secret. It was an act of US Congress, where they sat down and debated most of the aspects.The Fed is a cartel, created in secret, to protect banks against their own foolish behaviors.
False. The only thing that bothers the taxpayer is whether he is better off than he was yesterday or not.•The Fed is the mechanism used by government to finance the expansion of its power far beyond what taxpayers would otherwise have allowed.
Easy money did not cause the great depression. What caused the great depression is the misallocation of funds to unproductive uses. For example the boom in Germany during 1920s which resulted in many cities and provinces building prestigious projects like opera houses, etc which had little or no economic use.•The Great Depression resulted from the Fed’s huge increase in the supply of money during the Roaring Twenties. What made them "Roaring"? Easy money, thanks to the Fed.
And what of the biggest bubble of 1920s? And guess what there was no Fed in 1800s and yet we saw the biggest economic difficulties in 1800s.•Bubbles? What about the biggest bubble, funded with easy money that fed the housing boom? The same housing bubble that the good professor himself missed entirely until it was falling all over him and his mahogany table experts.
Gold Standard does something worse. It puts power into hands of people who can dig it out of their soil. Not in hands of people who can create iPads or a beetle or Walkman or Ferrari or Sukhio fighter jets or carry out the green revolution in India. If we had followed the gold standard, we would be in place of somalia, as we dont have any gold-ore to speak of. Rather the world super power would be south Africa.Why didn’t the professor tell the truth — the dirty little secret that former Fed chairman Alan Greenspan exposed in his article “Gold and Economic Freedom” published in Capitalism: The Unknown Ideal? Here's what Greenspan had to say:
This is the shabby secret of the welfare statists’ tirades against gold. Deficit spending is simply a scheme for the “hidden” confiscation of wealth
Gold stands in the way of this insidious process. It stands as a protector of property rights
I afraid you are ignorant about the scam that is central banking.Christopher Sidor wrote:So in no way does central bank compel anyone, least of all citizens, to use X or Y. Free will or Choice is still in the hands of people.
You mean room for counterfeiting money. Its a straight jacket for banking crooks looking for bailouts & bonuses. Its a life jacket for anyone doing a real job in the productive economy.And there is nothing beautiful about the so called "limitation" that the gold standard places on banks and consequently governments. It is a straight jacket which prevents room for maneuver.
Which is good. Money has to be limited in quantity in order to have value. There is always enough gold and everything else to be had in the market - just a question of price.Absolutely true. What the gold standard does is limit the amount of money supply to the amount of gold that can be dug out from the ground and placed again underground in some vault.
Lie. The chief cause of the great depression was fractional reserve banking aka counterfeiiting by banks. They lend out more than they had and imploded. The chief cause of every economic disaster is counterfeiting including the current one. The solution to a counterfeiting problem is not more counterfeiting.One of the chief causes of great depression was the thrall that people had of the gold standard.
Nobody said it prevents booms or busts. However the gamblers are the ones who take the loss under a gold standard - not the savers. The worthless paper money standard offloads the gambling losses of banking crooks onto the backs of suckers by contrast.So gold standard does nothing to avoid the so-called booms and busts.
Wrong, fastest US economic growth occured under the gold standard in the late 1800s.And oh one more thing, the best economic growth in US history happened not under gold standard but after the world went away from gold standard.
You are ignorant of how the Federal Reserve came about.Absolutely true. It was meant to prevent bank runs and preventing cascading collapses of banking financial entities. It has stayed true to its mandate, even in case of horrific consequences. But Fed was not created in secret. It was an act of US Congress, where they sat down and debated most of the aspects.
I'm afraid the idea of some guy counterfeiting worthless paper and offloading gambling losses of his cronies onto suckers has been tried & failed not once but many times over. There have been 60,000 or so paper currencies in existance for all of modern history and almost all have ended up being worthless.Gold Standard does something worse. It puts power into hands of people who can dig it out of their soil. Not in hands of people who can create iPads or a beetle or Walkman or Ferrari or Sukhio fighter jets or carry out the green revolution in India.
Like I said RBI has no authority to enforce the rule that only INR will have to be used within the boundaries of India. If I want to use USD or Kuwati Dinar or Yen within India, I have freedom to use it. The issue is the counter-party, or the person on the other end of the transaction must be willing to accept the currency in which I want to transact. In fact in Afghanistan this happens, in spite of there being an afghani currency. In certain other countries, they don't have their own currency but depend on currency of some other nation. In certain other currencies, there are two legal tenders, for example in Nepal and to some extent in Bhutan.Neshant wrote:I afraid you are ignorant about the scam that is central banking.Christopher Sidor wrote:So in no way does central bank compel anyone, least of all citizens, to use X or Y. Free will or Choice is still in the hands of people.
If central banks are not forcing people to use their worthless paper as claimed, they should have no problem with competing currencies with legal tender status being introduced into the economy. A competing currency should not be subject to capital gains taxation, sales tax or numerous other taxes to prevent people from acquiring/trading with it. After all, when capital gains are levied against gold, its not the case that gold has increased in value but that paper money has lost value. Why pay a tax for having preserved wealth?
Misguided notions.Neshant wrote: In fact if central banks allowed competing currencies, nobody would be holding their worthless paper. The only way they can get people to accept worthless paper is by force and that force is government.
It is a straight jacket for the monetary policy. In times of panic money flees the economy. In these time, it is necessary to keep the financial system adequately supplied by money. In case of Gold standard this cannot be done. In fact the reverse happens, the money supply gets contracted and thus fueling the panic. This aggravates a already bad situation, making it worse.Neshant wrote:You mean room for counterfeiting money. Its a straight jacket for banking crooks looking for bailouts & bonuses. Its a life jacket for anyone doing a real job in the productive economy.Christopher Sidor wrote:And there is nothing beautiful about the so called "limitation" that the gold standard places on banks and consequently governments. It is a straight jacket which prevents room for maneuver.
There is not enough gold available in the world which can sustain the current level of trade and development. Moreover people tend to hoard gold, thus reducing the amount in circulation, thus contracting economic activity even more.Neshant wrote:Which is good. Money has to be limited in quantity in order to have value. There is always enough gold and everything else to be had in the market - just a question of price.Christopher Sidor wrote:Absolutely true. What the gold standard does is limit the amount of money supply to the amount of gold that can be dug out from the ground and placed again underground in some vault.
No. The chief cause was not the loose money policies of the fed but when the contraction came, it was the gold standard which did not permit the money supply to grow to meet the demand. This resulted in banks collapsing. For those banks which survived, it meant that the banks shrunk their balance sheets, thus contracting the economy and industrial production. It is estimated that industrial production fell by 25% or even more in some cases.Neshant wrote:Lie. The chief cause of the great depression was fractional reserve banking aka counterfeiiting by banks. They lend out more than they had and imploded. The chief cause of every economic disaster is counterfeiting including the current one. The solution to a counterfeiting problem is not more counterfeiting.Christopher Sidor wrote: One of the chief causes of great depression was the thrall that people had of the gold standard.
So gold standard utility is even worse.Neshant wrote:Nobody said it prevents booms or busts. However the gamblers are the ones who take the loss under a gold standard - not the savers. The worthless paper money standard offloads the gambling losses of banking crooks onto the backs of suckers by contrast.Christopher Sidor wrote: So gold standard does nothing to avoid the so-called booms and busts.
I said the best and not the fastest. Best economic growth means that the unemployment reaching a low of 2%. The income distribution becoming more even. In fact the heydays of gold standards also coincided with the heydays of people known as robber barons.Neshant wrote:Wrong, fastest US economic growth occured under the gold standard in the late 1800s.Christopher Sidor wrote: And oh one more thing, the best economic growth in US history happened not under gold standard but after the world went away from gold standard.
Enlighten us.Neshant wrote:You are ignorant of how the Federal Reserve came about.Christopher Sidor wrote: Absolutely true. It was meant to prevent bank runs and preventing cascading collapses of banking financial entities. It has stayed true to its mandate, even in case of horrific consequences. But Fed was not created in secret. It was an act of US Congress, where they sat down and debated most of the aspects.
Even more worse is the wealth of the person being determined on what he can dig up from inside the ground, rather than when he or she can productively do. Only non-democratic government confisticate wealth from the so called productive economy to sustain a few crooks at the top. Consider the size of US economy, now consider the total amount of money which was given to US finanical firms in the financial panic of 2008. Now consider that this was not done in 1930s. See where our grand parents landed and where we are currently.Neshant wrote:I'm afraid the idea of some guy counterfeiting worthless paper and offloading gambling losses of his cronies onto suckers has been tried & failed not once but many times over. There have been 60,000 or so paper currencies in existance for all of modern history and almost all have ended up being worthless.Christopher Sidor wrote: Gold Standard does something worse. It puts power into hands of people who can dig it out of their soil. Not in hands of people who can create iPads or a beetle or Walkman or Ferrari or Sukhio fighter jets or carry out the green revolution in India.
Worthless paper is all about taking from the people who create & work. Worse yet, the taking is done by con artists who toss around financial jargon but who really are cluelss as fu&k. They pretend to know what ails the economy and how to control supply & demand by fiddling around with interest rates and money printing when really they are filling their pockets & that of their cronies. The co-opting of govt into confiscating wealth from the productive economy using increasingly draconian means to sustain a few crooks at the top eventually wrecks the entire fabric of the country. The biggest problem I have with worthless paper money is it transfers wealth from people who earned it to people who counterfeited it.
It seems that you are opposed to government bailing out banks and other financial institutions. Your gripe is against government putting taxpayers on hook for bets made by private parties. It does appear that you dont want to privatize the profits and socialize the losses. Fair enough. But the solution is not to bring back a "barbarous relic of the past", i.e gold standard.Neshant wrote: I'm for a system of privately issued competing currencies with legal tender status. That is true capitalism because it is the market (people who earn the money) get to select the money. Not some corruptable fool at the top who thinks he's wiser than the free market. Central banking is a fraud of a profession.
Now here's a question : The worthless paper money system is all about printing aka counterfeiting money. Now if counterfeiting money is good, shouldn't we all be doing it? I'd like to print up a few $100 bills on my laser printer and stimulate the economy.
Christopher Sidor Ji,Christopher Sidor wrote:Like I said RBI has no authority to enforce the rule that only INR will have to be used within the boundaries of India. If I want to use USD or Kuwati Dinar or Yen within India, I have freedom to use it.
FEMA permits only authorised person to deal in foreign exchange or foreign security. Such an authorised person, under the Act, means authorised dealer,money changer, off-shore banking unit or any other person for the time being authorised by Reserve Bank. The Act thus prohibits any person who:-
[*]Deal in or transfer any foreign exchange or foreign security to any person not being an authorized person